Bitcoin

A Manual Guide to Killing Bitcoin: The Eternal Return

Published

3 weeks ago

August 27, 2024

This article is featured in Bitcoin Magazine’s “The Halving Issue”. Click here to get your copy.

Every morning at 6am, in Punxsutawney, Pennsylvania, the cynic weatherman Phil Connors wakes up to experience the same day over and over and over again. Stuck in a time loop, Connors tries everything to get his life back to normal – he gets stabbed, shot, burned, frozen and electrocuted, only to wake up again the next day as if nothing had happened. Connors quickly comes to the only plausible conclusion: he must be a god.

Thinking ourselves to be undefeatable has never been a particularly smart strategy, in times of war or otherwise. If we believe in cosmology, from Nietzsche to Hinduism, time is a loop, and there is a finite realm of possibilities which infinitely repeat – the only thing that we can really do is change how we react. Unless we learn from our mistakes, we are doomed to experience the same things over and over again.

Though often priding ourselves in exceptional intellect – I’ve found Bitcoin early, I must be very smart – it seems that learning from mistakes comes hard even for the most seasoned ‘Bitcoin advocates’. Public discourse seems to have shifted from the discussion of technological challenges and limitations to Deutsche Bank afterwork chats – Anything is possible, we’ll just need returns to remain on track.

When Bitcoin was first discussed in German Parliament back in 2014, ‘experts’ highlighted the ease with which bitcoin payments could be deanonymized via network analysis, speaking to the risks of widespread bitcoin adoption to lead towards total financial surveillance. Today, ten years later, as Bitcoin has returned to German parliament, ‘experts’ have been exchanged for influencers proposing Bitcoin as CBDC alternatives. Current ‘Bitcoin political debates’ cannot help but remind us of Bart Simpson running in circles banging a pan on his head.

As we continue to close in on the opportunist’s echo chamber, we have successfully swapped academic debate for cheerleading squads. Things will go great so long as you’re willing to take your tits out. ‘We’re winning!’ has long become the prevalent meme – Between ETF approvals, stablecoin issuances, and possible nation state adoption we are so confident in Bitcoin’s success that we seem incapable of realizing that this is precisely how you lose. Arrogance comes before most declines, and its exploitation has always been by design. By sowing manic delusions of invincibility, even the most trained commander will lead their sheep to slaughter.

Groundhog Day

A long long time ago, in a galaxy far away, we plugged our computers into landlines to access the three great W’s. For anyone who didn’t live alone, this practice was often doomed to reap a fair amount of havoc – Get off the computer, mom is waiting for a phone call.

So we can all agree that that sucked. But, due to a lack of technological advancements and accessibility to communicate wirelessly across distances (think of your favorite mesh network here), it was the most convenient option we had. The only problem: it led to a monopoly on web access points lying with telecommunications providers. Fast forward 20 years, and we now know that telecom providers monitor, analyze, and report anything that we do on the internet to government authorities under the guise of national security. A technology thought invincible for the liberation of the people quickly turned into its biggest enemy.

Now we can’t really talk about the success (and downfall) of peer-to-peer technologies without talking about Linkin Park. Linkin Park’s music, then still Hybrid Theory, circulated widely on the first P2P music file sharing network Napster. Downloaded from other people’s computers, accessing Linkin Park’s music was completely free. Their first studio album, Hybrid Theory, yet remains one of the top five most sold records in the world with 15 Million copies sold in the first three weeks alone.

Napster was a real world internet revolution – And the music industry was furious. As people happily infected their devices with potential computer AIDS, bands, rappers, and singer songwriters like the Arctic Monkeys, Dispatch or EMINEM were building fanbases even before breaking their first big record releases, and the musical establishment wasn’t having it. When Metallica sued the P2P platform for copyright infringement, clearly unhappy that their cult status and its consequential returns felt threatened, peer-to-peer music file sharing did not exactly die, but was quickly incorporated into more corporate friendly formats – from buying music via iTunes to music streaming via Spotify.

While it seemed unimaginable to put a technology like Napster back into the box, convenience, again, became king. Today, the majority of listeners do not own the music that they listen to, but subscribe to corporate databases of which neither artists, labels nor producers profit. Instead, the big winner of the music file sharing industry again turned out to be surveillance. Just last week, when Spotify updated its cookie policy, a push notification let EU users know which 695 data brokers would gain access to their information. Downloading files like ClapYourHandsSayYeah.mp3.exe (RIP) clearly was risky business, but the risks of surveillance capitalism reach much farther than a trashed computer.

In essence, the same thing happened to search engines. Going online in the early days of the world wide web was like getting dropped off in the middle of Yellow Stone national park without a map. There were thousands of places to go, but you needed to know where they were. With comprehensive link collections, platforms like Yahoo, AskJeeves or Google offered tremendous value to those less versed in their way around the WWW. Instead of asking your peers where something cool on the internet was, you simply asked Google. But, with moving away from word-of–mouth formats, we ended up with what has today been termed the great enshittification. The first few links are paid affiliate sites, and the ones after that are those who figured out how to efficiently play Google’s SEO formats, of course all packed and tailored to your supposed needs. Today, Google is one of the most valuable surveillance companies in the world. A software meant to aid in the liberalization of free information essentially became a tool for censorship.

Again and again, thinking that ‘technology has won’ only exacerbated its demise. We choose what is comfortable now only to stab ourselves in the back down the road. And before you know it – BING! It’s the whistling belly button at the high school talent show as the weatherman strikes again. To put it bluntly: we’re fucking up.

It’s the Filters, Stupid

In today’s pop-culture Bitcoin discourse, ignorance runs rampant. Lightning works until it doesn’t, let’s spend millions to put the Dollar on Bitcoin; It’s called priorities babe, look it up.

When Ordinals hit Bitcoin – think of them what you will – we suddenly realized that we were in trouble. In the global south, people quickly became unable to transact non-custodially. All the people you’ve told to DCA suddenly saw themselves facing exorbitant transaction fees, unable to move their funds. For those valuing their privacy even for smaller spends, participating in coinjoin rounds turned prohibitively expensive. No matter where we look, we still have a scaling problem. This problem does not exist because of Ordinals. It exists because we were so convinced of winning that we lost track of keeping our ignorance in check.

Over the past four years, the majority was more concerned with furthering its own narrative – everything is awesome and Bitcoin is the bestest currency on earth – than facing uncomfortable truths. We then proceeded to respond with an exorbitant amount of shortsightedness: it’s the filters, stupid.

Filtering out Ordinals transactions is a short term solution for a long term problem. Sure, blocking arbitrary data on the blockchain will necessarily drive fees down, but if global Bitcoin adoption is what you want, you’re not doing yourself any favors by proposing selective solutions to systemic issues. The thing is that being angry at JPEGs is easy. Taking on problems that challenge the ‘greatness of Bitcoin’, which some appear to have turned into their whole personality, is not. For every tweet that claims for Bitcoin to bring world peace – clearly by pure magic, or what the Wall Street losers turned Bitcoin economists call some backwards form of game theory – a little of the system dies.

We do not need your hopium; We need real world solutions to real world problems. That includes laying down the crack pipe and talking about the uncomfortable stuff: we are not winning – we are doing the opposite, because our ‘long time preference’ reaches about as far as our investment portfolios. You can kill Bitcoin. And it’s easier than you’d think.

Embrace, Extend, Extinguish

Over the past few years, debates around Bitcoin ‘winning’ looked pretty much the same. Senators are embracing Bitcoin: see, we are winning. BlackRock is embracing Bitcoin: see, we are winning. First they ignore you, then they laugh at you, then they realize that all you want is a pat on the back before the policeman comes to take your toys away. The laughing hasn’t stopped, it just happens behind your back.

The most plausible death of Bitcoin would happen less in name than in its total incorporation, at a point where the technology is simply not yet ready for ‘mass adoption’ – just like we have killed all peer-to-peer technologies that came before it. The death of Bitcoin is not the death of the tech, but the death of its usability.

At the center of the death of Bitcoin, at least in essence, continues to stand the scaling debate. When Gigablocks were first proposed, it seemed fairly obvious that a blockchain that takes 10 years to sync will lack in decentralization. In came the Lightning Network, which seemed to solve all of our issues: Scaling off-chain, securing on-chain. Smart. Except that we can only fit around 5000 channel opening and closing transactions inside of a block – hardly enough to let 8 Billion people use Bitcoin non-custodially.

Unfortunately, that didn’t stop influencers – or really anyone – from proclaiming their Hail Mary of desperation; Scaling Bitcoin obviously is a problem for future me. Too high was the thrill of finally being able to sit at the corporate dinner table and smug the obligatory ‘I told you so’. Putting non-believers into their place simply had to come first; if Bitcoin doesn’t exist to feed our fragile egos and pump up our sad little bank accounts, what really was the point? Freedom, Carajo! Welcome to your involuntary conversion at the church of satoshi’s witnesses, where we drop speeches on saving the world from tyranny more often than Biden changes his diapers.

So here we are. Six years after we bought our first stickers at the Blockstream store – the only thing you were able to buy when the first Lightning implementations launched, besides beer – and we’re still scrambling. Instead of fostering broad discussions around covenant proposals, which do come with real trade-offs and risks, we are busy labeling anyone not willing to ossify a spook, while ossification at this point in Bitcoin will certainly be the surest way to kill it.

Sometime in the near future, we’ll wish ourselves back to a time of a few hundred vBytes in fees. By then, we will have no choice but to use Bitcoin custodially. Say goodbye to freedom money: Bitcoin as we know it will be dead, unless we stop making the same mistakes.

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Bitcoin

Bitcoin Toughest Time Over: Why Q4 Could Be A Game-Changer

Published

12 hours ago

September 18, 2024

admin

An analyst has explained how the worst could be behind for Bitcoin, and Q4 may bring back bullish momentum if history is anything to go by.

Q3 Has Historically Been The Worst Time For Bitcoin Investors

In a new post on X, Capriole Investments founder Charles Edwards talked about how investors are going through the worst time for Bitcoin. Below is the table cited by the analyst, which breaks down the quarterly returns the cryptocurrency has seen throughout its history.

Bitcoin Quarterly Returns

As is visible, the third quarter of the year has generally been the worst time for Bitcoin throughout history, with average returns for the month standing at +5% and median ones at -4%

For perspective, the second-worst performing quarter tends to be Q2, but its average and median returns of +27% and +7%, respectively, are still significantly better than Q3’s.

On the other side of the spectrum is Q4, the next quarter of the current year. Bitcoin has had its best periods this quarter, with average and median returns at +89% and +57%, respectively.

“If you are still here, congratulations. You made it through the worst time to be in Bitcoin,” says Edwards in the post about BTC traders. “The best lies ahead.”

Last year, the cryptocurrency enjoyed an uplift of almost 57% in this period. With Q3 fast approaching a close, it remains to be seen how the BTC price ends up performing in Q4 this time around.

Speaking of historical patterns, on-chain analyst Checkmate discussed how the daily price performance distribution has looked across bear and bull markets in an X post.

Here is the chart shared by the analyst:

Bitcoin Bull & Bear Distribution

As displayed in the above graph, around 28% of bear market days have seen the asset trend higher than +1%, while about 38% have seen it decline by more than -1%. The remaining 34% of the days have seen the cryptocurrency remain within +1% to -1% of the previous day.

During bullish periods, Bitcoin has spent 33% of the days witnessing a rise of more than +1%, while 26% registering a drop of over -1%. The asset has consolidated for the remaining 41%.

The symmetry between the three types of days is interesting, but what stands out is how the distributions are almost the same between bear and bull markets.

“Day traders are attempting to beat a three-sided coin, with a third of all days rallying, a third selling-off, and a third doing nothing,” notes Checkmate.

BTC Price

Bitcoin has shown a sudden burst of bullish momentum during the last 24 hours as its price has jumped more than 5%, reaching the $60,900 level.

Bitcoin Price Chart

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Bitcoin

Human Rights Foundation Grants 10 Bitcoin to 20 Projects Worldwide

Published

1 day ago

September 17, 2024

admin

Today, the Human Rights Foundation (HRF) announced its most recent round of Bitcoin Development Fund grants, according to a press release sent to Bitcoin Magazine.

10 BTC, currently worth $590,000 at the time of writing, is being granted across 20 different projects around the world focusing on technical education for people living under authoritarian regimes, Bitcoin development conferences, decentralizing mining, and providing human rights groups with more private financial solutions. The main areas of focus for these grants center around Latin America, Asia, and Africa.

While the HRF did not disclose how much money each project is receiving specifically, the following 20 projects are the recipients of today’s round of grants worth 10 BTC, or 1 billion satoshis, in total:

African Bitcoiners, a community dedicated to onboarding Africans to Bitcoin. Key initiatives include a “Bitcoin for Beginners” course, free Lightning payment routing for merchants, and the ability to buy airtime and data with Bitcoin. With the continent plagued by political and economic turmoil, Bitcoin can serve as a path to financial sovereignty. Funding will support the production of educational materials and support operational expenses, including salaries, infrastructure, and tools.

Stratospher, a Bitcoin Core developer focused on enhancing the privacy and decentralization of the Bitcoin protocol. Their work includes improving peer-to-peer (P2P) network privacy, reviewing critical pull requests in the libsecp library, and mentoring of new talent. Their work is important in helping protect users from financial surveillance and censorship by authoritarian regimes. This funding will support their full-time development efforts.

Coracle, a Nostr web client designed to create a social media experience that empowers individuals. Developed by hodlbod, recent and planned updates include customizable and shareable feeds, improved direct messaging for privacy, and the development of encrypted public and private communities. By leveraging Nostr, Coracle could offer a new censorship-resistant communications platform for human rights activists. Funding will support the hiring of a full-time developer.

Harbor, an open-source ecash wallet built to provide better Bitcoin privacy. Started by the Mutiny team, Harbor is now an independent project led by Ben Carman and Paul Miller. Harbor incorporates multiple mints, is Tor-only, and automates fund management. Financial tools like Harbor can help empower human rights defenders facing government surveillance by offering strong privacy guarantees. This grant will support the development of Harbor’s 1.0 production release.

The 256 Foundation’s mission is to make Bitcoin mining free and open, supporting developments in the Bitaxe initiative are the flagship project in achieving that mission. Bitaxe provides an affordable entry point for home mining, offering protection against surveillance in authoritarian regimes and enabling individuals to mine Bitcoin discreetly. Funds will support multiple engineers building on and improving Bitaxe with the aim of making the Bitaxe formfactor available with more ASIC manufactures.

Kiveclair, a community in the Democratic Republic of Congo educating individuals about Bitcoin. Led by Gloire Wanzavalere, co-founder of Africa Bitcoin Conference, Kiveclair hosts monthly meetups, training sessions for activists, journalists, and developers, and provides shelter to refugees. It is also planning its first local conference. Funds will cover the cost of meetups, educational materials, equipment purchases, and the rental of an educational space.

Jeff Gardner, a full-time developer focused on bringing end-to-end encryption to Nostr Direct and Group Messages without centralized servers, making them resilient against state intervention. His work is vital for enabling private communication channels for individuals and activists. Funding will support ongoing development, allocating bounties to community contributors, and conducting a security audit of the project.

Silentium, a self-custodial, privacy-focused Bitcoin wallet with built-in Silent Payments. Developed by Louis Singer, Silentium can help protect activists’ financial privacy by enabling them to receive Bitcoin donations through unique addresses generated from a static public key. This prevents surveillance regimes from linking transactions to activist’s identities. This grant will support the wallet’s infrastructure, including a full cloud node, web server, and the hiring of a software developer.

BTC Shule, an educational initiative by Belyï Nobel Kubwayo. It equips Burundians with the knowledge and skills to use Bitcoin for uncensorable payments under Burundi’s authoritarian regime. The project is structured around three key initiatives: a bilingual (Kirundi and French) educational platform, a physical center to host meetups, and a Bitcoin support community via Whatsapp and Telegram. The grant will support the development of the digital platform, educational materials, and the building of the center.

EttaWallet, an open-source, self-custodial mobile Lightning wallet by Collin Rukundo, a software developer and co-founder/CTO of Splice Africa. The wallet is designed to improve usability and accessibility. It seeks to challenge the dominance of custodial wallets and empower citizens in the Global South to take full control over their funds. This grant will support further development of the wallet, improve localization efforts, and foster a growing community of users.

Tor relay operator associations to support increased network reliability and performance, as recommended by the Tor Project. Funding will allow relay operator associations to deploy nodes that improve the stability and reliability of onion services and increase network robustness against DOS attacks. Tor is vital to human rights activists, as well as Bitcoin and Lightning nodes that use onion services.

Rikto Xonghoti, a Bitcoin education initiative led by Anurag Saikia, Basanta Goswami, and Pallab Goswami. Focused on creating a Bitcoin circular economy in the state of Assam (a region marked by underdevelopment), the project offers online Bitcoin education in Assamese. It also plans to establish a physical Bitcoin center in the town of Titabar. This grant will support teacher salaries, the center’s development, and the acquisition of Bitcoin nodes and mining equipment to boost local economic growth.

Yes Bitcoin Haiti, a grassroots organization led by Val, Papouche, and Armand. It seeks to empower Haitians living in political and financial turmoil with Bitcoin. As a new project, it will proceed in phases: first, project leaders will complete the Bitcoin Diploma course offered by The Core; next, they will translate educational materials into Haitian Creole and host workshops. Funding will support project leaders’ salaries, the purchase of equipment, and the production of educational materials.

Bitcoin Indonesia, an educational initiative led by Dimas, Marius, Keypleb, and Diana. It focuses on building an educational platform in Bahasa Indonesia (local language), expanding the local Bitcoin community, and connecting Indonesian talent with Bitcoin-related companies to drive career opportunities. It has also successfully hosted the country’s largest Bitcoin conference. This grant will support content creation, community outreach, and operational expenses.

Bitcoin++, a Bitcoin-only developer conference series organized by software developer and educator Lisa Neigut. The conference features long-form lectures and workshops for developers eager to dive into the intricacies of Bitcoin technology. Held in cities like Mexico City, Buenos Aires, and Austin, Bitcoin++ has explored key themes like scripts, mempool, and soon, eCash. Funds will cover travel expenses for developers from authoritarian countries to attend the upcoming Bitcoin++ mints ecash conference in Berlin.

TABConf, a Bitcoin conference hosted by Michael Tidwell in Atlanta, GA. Its mission is to create a forum for protocol and application developers to debate and collaborate on Bitcoin. Through collaborative workshops and interactive activities, attendees can share their insights, knowledge, and experience to further Bitcoin development and innovation. Funds will be used to cover conference expenses and travel costs for developers in need of financial assistance.

Baltic Honeybadger, the world’s first non-profit, Bitcoin-only conference hosted by Hodl Hodl. With its cypherpunk roots, the conference fosters discussions on technologies that support financial freedom, security, and privacy, especially for those in authoritarian regimes. Funding will cover travel expenses for activists and human rights defenders to deepen their knowledge on Bitcoin as a human rights tool.

LaBitconf and Descentralizar, two annual conferences in Argentina. LaBitconf, hosted by Rodolfo Andragnes, is the longest-running Bitcoin conference in Latin America. Funds will cover travel expenses for software developers and keynote speakers. Descentralizar, a one-day event held in three cities across the country, offers debates, workshops, and networking opportunities for attendees. Funds will also support travel expenses and conference equipment. Given Argentina’s ongoing economic challenges, these conferences provide an opportunity for Argentines to explore Bitcoin as a tool for financial freedom.

Satsconf, the largest Bitcoin-only conference in South America. Held in São Paulo, Brazil’s economic hub, Satsconf connects the local community with global thought leaders, including macroeconomists, veteran Bitcoin educators, freedom advocates, and developers shaping the future of Bitcoin. Funds will support travel expenses for speakers, event logistics, and the hackathon.

Solidarity Summit: Standing with Political Prisoners, a Vienna-based event organized by Hager Eissa that unites former political prisoners, human rights advocates, and others to address the challenges faced by political prisoners. The Summit promotes dialogue, advocacy, and support for political prisoners worldwide and serves as a catalyst for change. HRF support will help add a financial freedom component to the program. A documentary will also be produced to further highlight these issues. Funds will cover venue and event logistics, program development, speaker costs, and film production.

The HRF is a nonpartisan, nonprofit 501(c)(3) organization that promotes and protects human rights globally, with a focus on closed societies. The HRF continues to raise support for the Bitcoin Development Fund, and interested donors can find more info on how to donate bitcoin here. Applications for grant support by the HRF can be submitted here.

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Possible Bitcoin Q4 Fireworks in the Wings As Indicator Comes in Hot, Says Trader That Called 2021 BTC Collapse

Published

1 day ago

September 17, 2024

admin

A trader who nailed the May 2021 Bitcoin collapse says one indicator suggests BTC could be primed for fourth-quarter gains.

The pseudonymous analyst known as Dave the Wave tells his 146,900 followers on the social media platform X that BTC’s weekly moving average convergence divergence (MACD) indicator is “coming in hot and fast” and approaching a reset.

The MACD is a momentum indicator that traders use to watch possible trend reversals. Dave the Wave points to the previous time the MACD reset in late 2023, which corresponded to the beginning of a massive price upswing that saw Bitcoin hit a new all-time high in March.

The crypto analyst also shares a Bitcoin chart that estimates BTC could hit the $135,000 price range by mid-to-late 2025.

“BTC macro.”

Looking at the trader’s chart, he seems to predict that Bitcoin will start to gain bullish momentum in the coming months before igniting parabolic rallies in 2025.

Earlier this month, Dave the Wave shared a chart suggesting that BTC could start taking out resistance levels as early as October 1st.

The analyst’s chart also suggested that Bitcoin appeared to be trading in a triangle pattern while consolidating in a wide range.

“BTC 4th quarter fireworks?”

Bitcoin is trading at $58,144 at time of writing, a marginal decrease in the past day.

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